A Tory MP has warned the governments of Guernsey and Jersey to expect pressure to follow the Overseas Territories in introducing a public register of beneficial ownership.
Andrew Mitchell, together with Labour’s Margaret Hodge, were successful in their amendment to an anti-money laundering bill which will oblige so-called tax havens to introduce public beneficial ownership registers within the next two years.
An attempt by the Labour Party to extend that to the Crown Dependencies was withdrawn, while separate UK government amendments to water down the effect of the bill were ruled too late by the Speaker. It meant the government didn’t oppose the Mitchell/Hodge amendment.
But Mr Mitchell said it was now up to the government “to make the point persuasively, that we hope that the Crown Dependencies embrace the same ethical position and equal transparency”.
In the islands, the outcome of the debate was considered a success.
Deputy Gavin St Pier, President of Guernsey’s Policy & Resources Committee, said: “I welcome the news that the House of Commons has quite rightly chosen to respect our centuries-old constitutional relationship with the Crown. The Labour Party has withdrawn its attempt to impose domestic policy on the Islands when presented with a better understanding of the constitutional position.”
Jersey’s Chief Minister, Senator Ian Gorst, said: “I’m pleased that the UK Parliament has chosen not to seek to impose its will on Jersey, in direct contradiction of constitutional law, and ignoring the substantial work of the Island on transparency and robust financial regulation. This decision recognises the constitutional autonomy of the Island, and preserves the established historical relationship between Jersey and the United Kingdom.”
Guernsey and Jersey had worked with the Isle of Man to avert an attempt to include the islands in the amended bill.
Ahead of the debate, Senator Gorst, made it clear public registers were a possible eventuality, but not now.
He said: “If public registers were to become an international standard, we will consider implementing such a policy in the same way as we have other international standards in this area.”
Guernsey’s government holds the same position.
Speaking after the debate, Margaret Hodge MP said: “A great leap forward. The government accepts my amendment to introduce public registers of beneficial ownership in the Overseas Territories, something NGOs and anti-corruption campaigners have been demanding for years.”
The UK government imposing legislation on the Channel Islands threatened to spark a constitutional crisis, and strong push back from the States of Jersey and Guernsey.
Deputy St Pier said: “We always take any attempts to undermine our relationship with the UK with the utmost seriousness and will defend the ancient rights of islanders. We will also continue to engage with parliamentarians to ensure this relationship is well understood.”
Long time tax transparency campaigner Richard Murphy said: “To Margaret – and all who campaigned for this – many thanks. It’s a good day for real freedom, democracy, the rule of law and those who believe in tax justice.”